Judicial system needs to be consistent with bankruptcy law: Uday Kotak

India needs to improve its judicial procedures regarding bankruptcy and insolvency in order to ensure that lenders can recover their dues and continue to lend in confidence, Kotak Mahindra BankManaging Director and Chief Executive Officer Adi Kotak He said.

I think we really need to reform the judicial system that complies with bankruptcy law because at the end of the day, if banks lend money, we should be able to get the money back. “If we have a problem there, it constrains our ability to take better risks,” Kotak said when launching the project. Amitabh Kant’s book “Made in India” Friday.

There is a need for the judiciary to be in sync with the requirements of bankruptcy law, and courts must ensure that banks can recover money, Kotak said, adding that while insolvency and bankruptcy law (IBC) is a great concept for ensuring that a creditor remains in control, there is still a lot of work to do. to be done.

Also read: Is IBC the best resolution option for NBFCs?

Kotak also called for a better understanding of risks by Indian banks, saying that in order to grow the financial sector, banks need to understand and manage risks, such as acquisition, project or infrastructure financing.

“India has the brainpower and risk management to be able to manage the financial sector, which meets the aspirations of all India’s growth as we move forward,” he said, adding that this is required for Indian banks to finance large corporate actions, such as acquisitions.

Kotak added that he hopes to see an Indian financial entity among the top three financiers in the world in the next five to 10 years.

Earlier in March, Kotak said that the dissolution process Reliance Capital And Confidential companies Indicates a weak recovery below the creditors’ liquidation value.

“The NCLT process is also lagging behind whether it is IBC or otherwise. In IL&FS also, while the recovery ratio is better, the legal process takes too long. Time for policy reconsideration in financial sector decision,” he said then.

Also read: Credit Suisse says the CoC cannot finish dissolving Rcap pending NCLT litigation